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What Makes a Great Venture Capitalist

Jason Lemkin discusses how founders, and investors look for different things from venture capital funds and how that shapes what they consider to be a great VC.

Transcript

Bearing in mind that what a great VC means for founders, is a little bit different than what it means for LPs where the people who invest in VCs.

VCs is a financial product, it’s like a mutual fund. Or it’s just something that the VCs, own investors select all the people that they put money into VCs funds is that they care about is a number, results. What’s your IRR, what’s your return on capital. That’s all they care about, cash on cash returns.

What founders these days really want is a VC that was also a COO and a founder. Someone who can go through the journey. They all really want that, but it turns out, founders don’t actually make the best VCs. The best VCs are just grape pickers, and often times they are never an entrepreneur even for five seconds.

Bearing in mind that what a great VC means for founders, is a little bit different than what it means for LPs where the people who invest in VCs.

VCs is a financial product, it’s like a mutual fund. Or it’s just something that the VCs, own investors select all the people that they put money into VCs funds is that they care about is a number, results. What’s your IRR, what’s your return on capital. That’s all they care about, cash on cash returns.

What founders these days really want is a VC that was also a COO and a founder. Someone who can go through the journey. They all really want that, but it turns out, founders don’t actually make the best VCs. The best VCs are just grape pickers, and often times they are never an entrepreneur even for five seconds.

Every entrepreneur knows that starting an enterprise software company is hard. Jason Lemkin, Managing Partner with Storm Ventures and founder of EchoSign (acquired by Adobe), shares his secrets for how to start and run a successful SaaS enterprise software company. Jason is also one of the most popular startup bloggers in the world on his site called SaaStr.